The long-term goal of this work is to understand how the RNA interference (RNAi) pathway directs the formation of silent heterochromatic DNA domains. Heterochromatin is a conserved feature of eukaryotic chromosomes and plays important roles in regulation of gene expression and maintenance of chromosome stability in organisms ranging from yeast to human. In the fission yeast Schiozosaccharomyces pombe, the RITS (RNA-induced transcriptional silencing) complex uses small interfering RNAs (siRNAs) to target specific chromosome regions by base pairing interactions with nascent noncoding RNAs. This targeting is coupled to histone H3 lysine 9 (H3K9) methylation and the recruitment of proteins that mediate silencing. RITS also mediates siRNA amplification by recruiting the RNA-dependent RNA polymerase complex (RDRC) to promote the synthesis of double stranded RNA, which is cleaved into siRNAs by the Dicer ribonuclease. It has remained unclear how noncoding RNAs give rise to small RNA triggers that initiate RNAi, how RNA participates in the recruitment of histone H3K9 methyltransferase complex (CLRC), and how the recruitment of downstream factors such as HP1 proteins leads to transcriptional gene silencing. In this proposal we will use a combination of in vivo approaches and biochemical assays to investigate (1) the functional elements in centromeric RNAs and their associated factors that trigger RNAi, (2) the mechanism of siRNA-mediated chromatin methylation, and (3) the molecular mechanism of heterochromatin-dependent transcriptional gene silencing. The ultimate goal of these studies is a complete molecular understanding of gene silencing.